LIMA 9579 OF NOV 13, 1974, PARIS 09983,
LIMA 3623 (NOTAL), LIMA A-78 OF MAY 9, 1975 (NOTAL)
SUMMARY: BECAUSE OF PERU'S POTENTIAL AS A RAW MATERIALS
PRODUCER, JAPAN UNTIL RECENTLY SEEMED TO CONSIDER PERU A
LOGICAL PLACE FOR MAJOR INVESTMENT AND LOAN OPERATIONS.
HOWEVER, JAPANESE INTEREST IN PERU SEEMS TO HAVE DIMINISHED
RECENTLY. IN PART, THIS MIGHT BE EXPLAINED BY VARIOUS
DOMESTIC PERUVIAN EVENTS -- THE CONFRONTATION PRECIPITATED
BY SEVERAL PERUVIAN LAWYERS WHO BELIEVED THAT THE GOP
AGREEMENT WITH JAPAN FOR PARTIAL FINANCING OF THE
TRANS-ANDEAN PIPELINE WAS ILLEGAL AND PROBLEMS BETWEEN
THE GOP AND THE U.S. OWNED MARCONA MINING CO. WHICH
SELLS MOST OF ITS IRON PELLET PRODUCTION TO JAPAN.
POSSIBLE DISILLUSIONMENT WITH PERU'S OIL PROSPECTS AND
WITH PROJECT IMPLEMENTATION OF THE MICHIQUILLAY COPPER
DEPOSIT MAY ALSO CONTRIBUTE TO LESSENING INTEREST.
LIMITED OFFICIAL USE
LIMITED OFFICIAL USE
PAGE 02 LIMA 03937 01 OF 02 141600Z
FINALLY, AT THE RECENT IBRD CONSULTATIVE GROUP MEETING
THE JAPANESE DELEGATE PRIVATELY MENTIONED THAT JAPAN
WAS HAVING PROBLEMS IMPLEMENTING A MICROWAVE PROJECT AND
WAS NOT PLANNING TO FINANCE ANY PROJECTS ON PERU'S
1975-1977 LIST, THE CLEAREST INDICATOR TO DATE OF A
CHANGE IN GOJ THINKING ABOUT PERU. THIS CABLE CONTAINS
SEVERAL SUBJECTS WHICH MIGHT BE OF MUTUAL INTEREST TO
RAISE IN THE CONSULTATIONS ON LATIN AMERICA. END
SUMMARY.
1. UNTIL RECENTLY JAPAN APPEARED TO CONSIDER PERU A
LOGICAL PLACE FOR MAJOR INVESTMENT AND LOAN ACTIVITIES.
PERU, AS A COUNTRY WITH SUBSTANTIAL POTENTIAL AS A RAW
MATERIALS PRODUCER, COULD SUPPLY JAPAN WITH ITS NEEDED
COPPER, SILVER, IRON, AND POSSIBLY PETROLEUM, ETC.
HOWEVER, OVER THE PAST SIX MONTHS JAPANESE INTEREST IN
PERU HAS WANED SOMEWHAT. THERE ARE SEVERAL FACTORS
WHICH HAVE PROBABLY CONTRIBUTED TO THIS CHANGE.
2. IN NOVEMBER JAPAN FOUND ITSELF THE INNOCENT IN-
STRUMENT USED IN A SERIOUS DOMESTIC CONFRONTATION.
SEVERAL MEMBERS OF THE LIMA BAR ASSOCIATION, AN ANTI-
GOP GROUP, ACCUSED THE GOP OF SELLING OUT THE "NATIONAL
PATRIMONY" BECAUSE OF THE TERMS OF ITS AGREEMENT WITH
THE JAPANESE FOR PARTIAL FINANCING OF THE TRANS-ANDEAN
PIPELINE. THIS AGREEMENT INCLUDED A CLAUSE WHICH PRO-
VIDES THAT ANY DISPUTE IN INTERPRETATION WOULD BE ADJU-
DICATED IN TOKYO UNDER JAPANESE LAW. ALTHOUGH NORMAL
INTERNATIONAL COMMERCIAL PRACTICE, THE LAWYERS COMPARED
THE CLAUSE WITH THE PREVIOUS BELAUNDE REGIME'S "SELL-OUT"
OVER IPC, THE INTERNATIONAL PETROLEUM COMPANY, WHICH
WAS THE PERUVIAN MILITARY'S PRETEXT FOR OVERTHROWING BELAUNDE
AND THE INSTALLATION OF THE PRESENT LEFTIST MILITARY
GOVERNMENT, LEADING TO STRAINED RELATIONS WITH THE UNITED
STATES. THE LAWYERS WERE DEPORTED AFTER EXTREMELY BITTER
AND BROAD ATTACKS ON THEM BY THE GOVERNMENT-CONTROLLED
PRESS (SEE LIMA 9579 AND 9615). THE JAPANESE EMBASSY HERE
INFORMED US THAT THE INDIRECT JAPANESE INVOLVEMENT CAUSED
CONCERN IN TOKYO ABOUT JAPAN'S OVERALL EXPOSURE IN PERU.
3. JAPAN PURCHASES MOST OF THE IRON PELLET PRODUCTION
LIMITED OFFICIAL USE
LIMITED OFFICIAL USE
PAGE 03 LIMA 03937 01 OF 02 141600Z
OF THE US-OWNED MARCONA MINING COMPANY IN PERU. MARCONA
MAY BE NATIONALIZED SHORTLY. THE MINISTER OF
ENERGY AND MINES HAS ANNOUNCED THAT IT WILL OCCUR BE-
FORE THE END OF 1975 (SEE LIMA 3623). IN ORDER TO
MAINTAIN A PROFITABLE LEVEL OF OPERATIONS, MARCONA MUST
EXPAND ITS PELLET PLANT FACILITIES WITH A $20 MILLION
INVESTMENT. FOR SEVERAL YEARS, THE COMPANY HAS BEEN
REQUESTING PERMISSION FROM THE GOP TO PROCEED WITH THIS
EXPANSION (FINANCED PRINCIPALLY BY THE JAPANESE). NOW,
HOWEVER, ANY SUCH EXPANSION WILL HAVE TO AWAIT THE OUT-
COME OF CURRENT NEGOTIATIONS BETWEEN MARCONA AND THE GOP.
IN THE MEANTIME, THE JAPANESE MIGHT BE EXPECTED TO SEEK
OUT OTHER LONG-TERM IRON SUPPLIERS WHO CAN EXPAND MORE
EASILY AS JAPAN'S REQUIREMENTS GROW. FURTHER, MARCONA
HAD RELIED ON JAPANESE SUPPORT IN ITS NEGOTIATIONS WITH
THE GOP AND HAD BEEN INFORMED THAT THE JAPANESE WOULD
NOT OFFER FINANCING DIRECTLY TO THE GOP UNLESS THERE WAS
AN AMICABLE SETTLEMENT. RECENTLY, HOWEVER, THE JAPANESE
ROLE HAS BECOME MURKY AND WE ARE NOT SURE THEY WOULD
CONTINUE TO SUPPORT MARCONA'S POSITION.
4. ARCO (ATLANTIC RICHFIELD) WITH ITS JAPANESE PARTNER,
ANDES PETROLEUM CO., IS THE FIRST FOREIGN OIL COMPANY
OFFICIALLY TO HAVE REQUESTED THAT THE GOP RELEASE
IT (FOR A $2 MILLION PENALTY FEE) FROM ITS COMMITMENT
TO DRILL FOUR WELLS IN THE NORTHERN PERUVIAN JUNGLE
BECAUSE DRILLING PROSPECTS DO NOT WARRANT THE EXPENSE.
CITIES SERVICE, IN A PARTNERSHIP WITH ANDES, IS NOW
DOING PRE-DRILLING SEISMIC STUDIES IN TWO OTHER
EXPLORATION-BLOCKS IN THE SOUTHERN PERUVIAN JUNGLE.
THUS FAR PROSPECTS LOOK BLEAK FOR THE PERUVIAN OIL BOOM
PREDICTED FURING THE PAST SEVERAL YEARS.
DEAN
LIMITED OFFICIAL USE
NNN
LIMITED OFFICIAL USE
PAGE 01 LIMA 03937 02 OF 02 141559Z
47
ACTION ARA-10
INFO OCT-01 EA-06 ISO-00 CIAE-00 DODE-00 PM-03 H-02 INR-07
L-02 NSAE-00 NSC-05 PA-01 PRS-01 SP-02 SS-15 USIA-06
EB-07 COME-00 TRSE-00 FEAE-00 AID-05 OMB-01 INT-05
OES-03 XMB-02 AGR-05 CIEP-01 /090 W
--------------------- 013328
R 132204Z MAY 75
FM AMEMBASSY LIMA
TO SECSTATE WASHDC 5122
INFO AMEMBASSY TOKYO
LIMITED OFFICIAL USE SECTION 2 OF 2 LIMA 3937
5. THE JAPANESE, THROUGH A MITSUBISHI-LED CONSORTIUM,
HAVE BEEN EXAMINING THE FEASIBILITY OF DEVELOPING THE
MICIQUILLAY COPPER DEPOSIT IN NORTHERN PERU. THIS IS
A (POSSIBLE) $1 BILLION PROJECT WITH LOGISTICAL PROBLEMS
FAR GREATER THAN THOSE BEING ENCOUNTERED IN THE CON-
STRUCTION OF THE TRANS-ANDEAN OIL PIPELINE. IT WILL
REQUIRE A VERY LARGE CAPITAL OUTLAY BY THE GOP FOR
INFRASTRUCTURE DEVELOPMENT IN THE REGION. PROGRESS
HAS BEEN EXTREMELY SLOW ON THIS PROJECT.
6. TOYO ENGINEERING AND MITSUBISHI HAVE JUST COMPLETED
THE CONSTRUCTION OF A $44 MILLION FERTILIZER COMPLEX AT
TALARA FOR PETROPERU (LIMA A-78 OF MAY 9, 1975).
MITSUI-FURUKAWA IS ABOUT TO COMPLETE A $60 MILLION
COPPER REFINERY AT ILO FOR MINEROPERU.
7. AFTER THE IBRD CONSULTATIVE GROUP MEETING IN PERU
HELD IN PARIS ON APRIL 16-17 (PARIS 09983), THE JAPANESE
DELEGATE MENTIONED TO US THAT BECAUSE OF PROBLEMS IN
PERU, INCLUDING DIFFICULTIES IN PROJECT IMPLEMENTATION,
JAPAN IS NOT NOW PLANNING TO FINANCE ANY PROJECTS ON THE 1975-
1977 $6 BILLION PROJECT LIST PRESENTED BY PERU (EXCEPT,
LIMITED OFFICIAL USE
LIMITED OFFICIAL USE
PAGE 02 LIMA 03937 02 OF 02 141559Z
WE IMAGINE, MICHIQUILLAY REMAINING AS A POSSIBILITY).
THIS IS INTERESTING AS ONE OF THE FIRST JAPANESE
STATEMENTS REVEALING POSSIBLE DISILLUSIONMENT WITH PERU.
8. USING THE ABOVE AND THE REFERENCED MESSAGES AS
BACKGROUND, WE BELIEVE IT WOULD BE USEFUL FOR
THE U.S. DELEGATION TO EXPLORE, POSSIBLY INFORMALLY, THE
FOLLOWING ITEMS:
(A) WHAT ARE JAPANESE VIEWS ON STATUS OF PERUVIAN
ECONOMY? IN PARTICULAR, WITH REFERENCE TO OIL, DO
JAPANESE BELIEVE THAT PERU'S PROVEN RESERVES WILL BE
SUFFICIENT TO ENABLE GOP TO REPAY THE $330 MILLION LOAN
FOR THE TRANS-ANDEAN PIPELINE AND JUNGLE EXPLORATION, BEGINNING
IN 1978?
(B) DO JAPANESE INTEND TO DEVELOP MAJOR MINING
PROJECTS, SUCH AS MICHIQUILLAY? FURTHER, HOW DOES GOJ
VIEW MARCONA BUY-OUT NEGOTIATIONS AND WILL JAPANESE
CONTINUE TO SUPPORT MARCONA'S POSITION RE PELLET-PLANT
EXPANSION?
(C) HAVE JAPANESE DECIDED IN FACT NOT TO SUPPORT ANY
OTHER PROJECTS ON WORLD BANK LIST?
(D) HOW DOES JAPAN VIEW THE MILITANT CIPEC POLICY LINE
ESPOUSED BY THE GOP? HAS PERUVIAN MILITANCY IN CIPEC--AND
FOR THAT MATTER THE ENTIRE RANGE OF PRODUCER'S AND THIRD-WORLD
INITIATIVES--BEEN A FACTOR IN OVERALL REASSESSMENT OF JAPANESE
ROLE HERE?
(E) IS THERE ANY GOJ REACTION TO EFFUSIVE
CONGRATULATORY MESSAGE PRESIDENT VELASCO SENT TO THE
VIET CONG AFTER FALL OF SOUTH VIETNAM?
DEAN
LIMITED OFFICIAL USE
NNN

Raw content

LIMITED OFFICIAL USE
PAGE 01 LIMA 03937 01 OF 02 141600Z
47
ACTION ARA-10
INFO OCT-01 EA-06 ISO-00 CIAE-00 DODE-00 PM-03 H-02 INR-07
L-02 NSAE-00 NSC-05 PA-01 PRS-01 SP-02 SS-15 USIA-06
EB-07 COME-00 TRSE-00 FEAE-00 AID-05 OMB-01 INT-05
OES-03 XMB-02 AGR-05 CIEP-01 /090 W
--------------------- 013352
R 132204Z MAY 75
FM AMEMBASSY LIMA
TO SECSTATE WASHDC 5121
INFO AMEMBASSY TOKYO
LIMITED OFFICIAL USE SECTION 1 OF 2 LIMA 3937
EO 11652: NA
TAGS: OCON,PFOR,XM,JA,PE
SUBJ: U.S. JAPANESE CONSULTATIONS ON LATIN AMERICA
REFS: STATE 107241, STATE 48628, LIMA 9615 OF NOV 14, 1974,
LIMA 9579 OF NOV 13, 1974, PARIS 09983,
LIMA 3623 (NOTAL), LIMA A-78 OF MAY 9, 1975 (NOTAL)
SUMMARY: BECAUSE OF PERU'S POTENTIAL AS A RAW MATERIALS
PRODUCER, JAPAN UNTIL RECENTLY SEEMED TO CONSIDER PERU A
LOGICAL PLACE FOR MAJOR INVESTMENT AND LOAN OPERATIONS.
HOWEVER, JAPANESE INTEREST IN PERU SEEMS TO HAVE DIMINISHED
RECENTLY. IN PART, THIS MIGHT BE EXPLAINED BY VARIOUS
DOMESTIC PERUVIAN EVENTS -- THE CONFRONTATION PRECIPITATED
BY SEVERAL PERUVIAN LAWYERS WHO BELIEVED THAT THE GOP
AGREEMENT WITH JAPAN FOR PARTIAL FINANCING OF THE
TRANS-ANDEAN PIPELINE WAS ILLEGAL AND PROBLEMS BETWEEN
THE GOP AND THE U.S. OWNED MARCONA MINING CO. WHICH
SELLS MOST OF ITS IRON PELLET PRODUCTION TO JAPAN.
POSSIBLE DISILLUSIONMENT WITH PERU'S OIL PROSPECTS AND
WITH PROJECT IMPLEMENTATION OF THE MICHIQUILLAY COPPER
DEPOSIT MAY ALSO CONTRIBUTE TO LESSENING INTEREST.
LIMITED OFFICIAL USE
LIMITED OFFICIAL USE
PAGE 02 LIMA 03937 01 OF 02 141600Z
FINALLY, AT THE RECENT IBRD CONSULTATIVE GROUP MEETING
THE JAPANESE DELEGATE PRIVATELY MENTIONED THAT JAPAN
WAS HAVING PROBLEMS IMPLEMENTING A MICROWAVE PROJECT AND
WAS NOT PLANNING TO FINANCE ANY PROJECTS ON PERU'S
1975-1977 LIST, THE CLEAREST INDICATOR TO DATE OF A
CHANGE IN GOJ THINKING ABOUT PERU. THIS CABLE CONTAINS
SEVERAL SUBJECTS WHICH MIGHT BE OF MUTUAL INTEREST TO
RAISE IN THE CONSULTATIONS ON LATIN AMERICA. END
SUMMARY.
1. UNTIL RECENTLY JAPAN APPEARED TO CONSIDER PERU A
LOGICAL PLACE FOR MAJOR INVESTMENT AND LOAN ACTIVITIES.
PERU, AS A COUNTRY WITH SUBSTANTIAL POTENTIAL AS A RAW
MATERIALS PRODUCER, COULD SUPPLY JAPAN WITH ITS NEEDED
COPPER, SILVER, IRON, AND POSSIBLY PETROLEUM, ETC.
HOWEVER, OVER THE PAST SIX MONTHS JAPANESE INTEREST IN
PERU HAS WANED SOMEWHAT. THERE ARE SEVERAL FACTORS
WHICH HAVE PROBABLY CONTRIBUTED TO THIS CHANGE.
2. IN NOVEMBER JAPAN FOUND ITSELF THE INNOCENT IN-
STRUMENT USED IN A SERIOUS DOMESTIC CONFRONTATION.
SEVERAL MEMBERS OF THE LIMA BAR ASSOCIATION, AN ANTI-
GOP GROUP, ACCUSED THE GOP OF SELLING OUT THE "NATIONAL
PATRIMONY" BECAUSE OF THE TERMS OF ITS AGREEMENT WITH
THE JAPANESE FOR PARTIAL FINANCING OF THE TRANS-ANDEAN
PIPELINE. THIS AGREEMENT INCLUDED A CLAUSE WHICH PRO-
VIDES THAT ANY DISPUTE IN INTERPRETATION WOULD BE ADJU-
DICATED IN TOKYO UNDER JAPANESE LAW. ALTHOUGH NORMAL
INTERNATIONAL COMMERCIAL PRACTICE, THE LAWYERS COMPARED
THE CLAUSE WITH THE PREVIOUS BELAUNDE REGIME'S "SELL-OUT"
OVER IPC, THE INTERNATIONAL PETROLEUM COMPANY, WHICH
WAS THE PERUVIAN MILITARY'S PRETEXT FOR OVERTHROWING BELAUNDE
AND THE INSTALLATION OF THE PRESENT LEFTIST MILITARY
GOVERNMENT, LEADING TO STRAINED RELATIONS WITH THE UNITED
STATES. THE LAWYERS WERE DEPORTED AFTER EXTREMELY BITTER
AND BROAD ATTACKS ON THEM BY THE GOVERNMENT-CONTROLLED
PRESS (SEE LIMA 9579 AND 9615). THE JAPANESE EMBASSY HERE
INFORMED US THAT THE INDIRECT JAPANESE INVOLVEMENT CAUSED
CONCERN IN TOKYO ABOUT JAPAN'S OVERALL EXPOSURE IN PERU.
3. JAPAN PURCHASES MOST OF THE IRON PELLET PRODUCTION
LIMITED OFFICIAL USE
LIMITED OFFICIAL USE
PAGE 03 LIMA 03937 01 OF 02 141600Z
OF THE US-OWNED MARCONA MINING COMPANY IN PERU. MARCONA
MAY BE NATIONALIZED SHORTLY. THE MINISTER OF
ENERGY AND MINES HAS ANNOUNCED THAT IT WILL OCCUR BE-
FORE THE END OF 1975 (SEE LIMA 3623). IN ORDER TO
MAINTAIN A PROFITABLE LEVEL OF OPERATIONS, MARCONA MUST
EXPAND ITS PELLET PLANT FACILITIES WITH A $20 MILLION
INVESTMENT. FOR SEVERAL YEARS, THE COMPANY HAS BEEN
REQUESTING PERMISSION FROM THE GOP TO PROCEED WITH THIS
EXPANSION (FINANCED PRINCIPALLY BY THE JAPANESE). NOW,
HOWEVER, ANY SUCH EXPANSION WILL HAVE TO AWAIT THE OUT-
COME OF CURRENT NEGOTIATIONS BETWEEN MARCONA AND THE GOP.
IN THE MEANTIME, THE JAPANESE MIGHT BE EXPECTED TO SEEK
OUT OTHER LONG-TERM IRON SUPPLIERS WHO CAN EXPAND MORE
EASILY AS JAPAN'S REQUIREMENTS GROW. FURTHER, MARCONA
HAD RELIED ON JAPANESE SUPPORT IN ITS NEGOTIATIONS WITH
THE GOP AND HAD BEEN INFORMED THAT THE JAPANESE WOULD
NOT OFFER FINANCING DIRECTLY TO THE GOP UNLESS THERE WAS
AN AMICABLE SETTLEMENT. RECENTLY, HOWEVER, THE JAPANESE
ROLE HAS BECOME MURKY AND WE ARE NOT SURE THEY WOULD
CONTINUE TO SUPPORT MARCONA'S POSITION.
4. ARCO (ATLANTIC RICHFIELD) WITH ITS JAPANESE PARTNER,
ANDES PETROLEUM CO., IS THE FIRST FOREIGN OIL COMPANY
OFFICIALLY TO HAVE REQUESTED THAT THE GOP RELEASE
IT (FOR A $2 MILLION PENALTY FEE) FROM ITS COMMITMENT
TO DRILL FOUR WELLS IN THE NORTHERN PERUVIAN JUNGLE
BECAUSE DRILLING PROSPECTS DO NOT WARRANT THE EXPENSE.
CITIES SERVICE, IN A PARTNERSHIP WITH ANDES, IS NOW
DOING PRE-DRILLING SEISMIC STUDIES IN TWO OTHER
EXPLORATION-BLOCKS IN THE SOUTHERN PERUVIAN JUNGLE.
THUS FAR PROSPECTS LOOK BLEAK FOR THE PERUVIAN OIL BOOM
PREDICTED FURING THE PAST SEVERAL YEARS.
DEAN
LIMITED OFFICIAL USE
NNN
LIMITED OFFICIAL USE
PAGE 01 LIMA 03937 02 OF 02 141559Z
47
ACTION ARA-10
INFO OCT-01 EA-06 ISO-00 CIAE-00 DODE-00 PM-03 H-02 INR-07
L-02 NSAE-00 NSC-05 PA-01 PRS-01 SP-02 SS-15 USIA-06
EB-07 COME-00 TRSE-00 FEAE-00 AID-05 OMB-01 INT-05
OES-03 XMB-02 AGR-05 CIEP-01 /090 W
--------------------- 013328
R 132204Z MAY 75
FM AMEMBASSY LIMA
TO SECSTATE WASHDC 5122
INFO AMEMBASSY TOKYO
LIMITED OFFICIAL USE SECTION 2 OF 2 LIMA 3937
5. THE JAPANESE, THROUGH A MITSUBISHI-LED CONSORTIUM,
HAVE BEEN EXAMINING THE FEASIBILITY OF DEVELOPING THE
MICIQUILLAY COPPER DEPOSIT IN NORTHERN PERU. THIS IS
A (POSSIBLE) $1 BILLION PROJECT WITH LOGISTICAL PROBLEMS
FAR GREATER THAN THOSE BEING ENCOUNTERED IN THE CON-
STRUCTION OF THE TRANS-ANDEAN OIL PIPELINE. IT WILL
REQUIRE A VERY LARGE CAPITAL OUTLAY BY THE GOP FOR
INFRASTRUCTURE DEVELOPMENT IN THE REGION. PROGRESS
HAS BEEN EXTREMELY SLOW ON THIS PROJECT.
6. TOYO ENGINEERING AND MITSUBISHI HAVE JUST COMPLETED
THE CONSTRUCTION OF A $44 MILLION FERTILIZER COMPLEX AT
TALARA FOR PETROPERU (LIMA A-78 OF MAY 9, 1975).
MITSUI-FURUKAWA IS ABOUT TO COMPLETE A $60 MILLION
COPPER REFINERY AT ILO FOR MINEROPERU.
7. AFTER THE IBRD CONSULTATIVE GROUP MEETING IN PERU
HELD IN PARIS ON APRIL 16-17 (PARIS 09983), THE JAPANESE
DELEGATE MENTIONED TO US THAT BECAUSE OF PROBLEMS IN
PERU, INCLUDING DIFFICULTIES IN PROJECT IMPLEMENTATION,
JAPAN IS NOT NOW PLANNING TO FINANCE ANY PROJECTS ON THE 1975-
1977 $6 BILLION PROJECT LIST PRESENTED BY PERU (EXCEPT,
LIMITED OFFICIAL USE
LIMITED OFFICIAL USE
PAGE 02 LIMA 03937 02 OF 02 141559Z
WE IMAGINE, MICHIQUILLAY REMAINING AS A POSSIBILITY).
THIS IS INTERESTING AS ONE OF THE FIRST JAPANESE
STATEMENTS REVEALING POSSIBLE DISILLUSIONMENT WITH PERU.
8. USING THE ABOVE AND THE REFERENCED MESSAGES AS
BACKGROUND, WE BELIEVE IT WOULD BE USEFUL FOR
THE U.S. DELEGATION TO EXPLORE, POSSIBLY INFORMALLY, THE
FOLLOWING ITEMS:
(A) WHAT ARE JAPANESE VIEWS ON STATUS OF PERUVIAN
ECONOMY? IN PARTICULAR, WITH REFERENCE TO OIL, DO
JAPANESE BELIEVE THAT PERU'S PROVEN RESERVES WILL BE
SUFFICIENT TO ENABLE GOP TO REPAY THE $330 MILLION LOAN
FOR THE TRANS-ANDEAN PIPELINE AND JUNGLE EXPLORATION, BEGINNING
IN 1978?
(B) DO JAPANESE INTEND TO DEVELOP MAJOR MINING
PROJECTS, SUCH AS MICHIQUILLAY? FURTHER, HOW DOES GOJ
VIEW MARCONA BUY-OUT NEGOTIATIONS AND WILL JAPANESE
CONTINUE TO SUPPORT MARCONA'S POSITION RE PELLET-PLANT
EXPANSION?
(C) HAVE JAPANESE DECIDED IN FACT NOT TO SUPPORT ANY
OTHER PROJECTS ON WORLD BANK LIST?
(D) HOW DOES JAPAN VIEW THE MILITANT CIPEC POLICY LINE
ESPOUSED BY THE GOP? HAS PERUVIAN MILITANCY IN CIPEC--AND
FOR THAT MATTER THE ENTIRE RANGE OF PRODUCER'S AND THIRD-WORLD
INITIATIVES--BEEN A FACTOR IN OVERALL REASSESSMENT OF JAPANESE
ROLE HERE?
(E) IS THERE ANY GOJ REACTION TO EFFUSIVE
CONGRATULATORY MESSAGE PRESIDENT VELASCO SENT TO THE
VIET CONG AFTER FALL OF SOUTH VIETNAM?
DEAN
LIMITED OFFICIAL USE
NNN